‘Collaboration’ has long been a buzzword in the business world.
Companies recognise that remaining relevant requires not only internal collaboration and team work, but also collaboration in the form of partnerships with other organisations.
Defined as “the situation of two or more people working together to create or achieve the same thing”, collaboration makes good business sense.
Consider the success of fast fashion retailer H&M’s collaborations with luxury design houses such as Balmain and Versace, or Uber and Spotify’s value-add partnership that allows you to connect your Spotify account to your Uber car’s radio.
But with great reward often comes great risk. Collaboration can be seen as a smoking gun means to achieving greater brand awareness and financial rewards based on a partnership vision that focuses too heavily on the ‘what’ – the strategy – and not enough on the ‘how’ – the tactics, or fails to adequately recognise the risks.
In these cases, the results can be disappointing. Loss of autonomy, dilution of your brand, lost time and resources, or a negative impact on your brand’s reputation, are just some of the risks.
So today I’m challenging you not to mention the ‘c’ word without first taking these six steps to determine whether you or your business are really in a position to commit to a collaboration.
Do so and you’ll be well on the way to more successful partnership opportunities that yield better results for you and your partners.
- Time is of the essence
The first key question you should consider is whether you have the time and resources to nurture a collaboration opportunity. You should consider the potential drain on company resources, both in terms of the number of hours key staff would likely spend on such a partnership, and upfront financial costs. Remember that the drain on financial and company resources is often greater than expected.
- Identify your processes
Before entering into any external collaborations or partnerships, you should identify your processes for critiquing the value of your collaboration. Ask: what am I seeking to get out of the partnership first and foremost? Once you know this, you’ll be able to deduce how best to measure this – whether it be greater brand awareness, a spike in sales of a particular product or service, or customer satisfaction levels.
- Leverage your strengths
When negotiating any partnership, be sure to know your strengths. Consider both your access to knowledge and people. For example, you may have a small team, but you could have expert specialised knowledge that is particularly valuable to a potential partner. Alternatively, you may have a broader organisational focus, but perhaps you have the people power to support this work and do more of the heavy-lifting. Knowing and leveraging your strengths before commencing negotiations with prospective partners will ensure you get a better deal for your business. Be prepared to ask yourself and your team the tough questions about what you bring to the table as an organisation.
- Mind the gap
Also be aware of your skill gaps – and ensure you partner with an organisation that doesn’t have the same gaps as you. Consider whether you have complementary skill-sets, and creative ways to bridge any skill gaps.
- Better off alone?
Finally, assess the ideas and opportunities that collaborations offer and weigh these up against the potential challenges. Ask yourself: am I really better off collaborating, or could I/we be better off alone? Consider what you could do with the resources required for your collaboration if you decide not to go ahead. Which option is more favourable from a commercial perspective? And don’t forget to consider brand reputation and PR risks. LEGO’s collaboration with Shell is one example of a company failing to recognise the PR risk of such an association, as attitudes to Shell’s environmental practices have shifted over time.
- Trust is a must
Finally, weigh up the ‘co-opetition’. The term, utilised to describe collaborations with organisations that would often be considered your natural competitors, sums up the need for trust. In order for partnerships to be truly successful, all parties need to be willing to share ideas and insights. At the same time, protecting your IP and business plans is essential to mitigate unnecessary risk.
So, be sure to exercise consideration and caution when using the ‘c’ word. While collaborations aren’t for everyone, successful partnerships can offer immense value to all parties.
I’m interested in your thoughts… Do you have a favourite company collaboration? And are there any other considerations you would weigh up before using the ‘c’ word?